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DEMURRAGES, CHARGES: Freight forwarders, transporters set for showdown with shipping firms, terminal operators

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By Godwin Oritse

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FOLLOWING the increase in the cost of cargo clearance, a maritime industry pressure group under the aegis of Concerned Freight Forwarders and Transporters, has given notice of action to shipping firms and terminal operators while demanding the immediate stoppage of demurrages and arbitrary charges.

Speaking at a meeting in Lagos last week, Chairman of the group, Mr. Andy Omenogo, said that the actions of these terminal operators and their sister shipping companies are sabotaging the reforms of the government in the port industry.

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He stated: ‘‘As major players and stakeholders in the shipping, freight forwarding and transportation  sub-sector of Nigerian maritime industry, our clients have come together to speak with one voice as people directly affected by arbitrary trade practices of shipping companies  and terminal operators that operate in Nigerian ports.

“The unfortunate practice that has been forced down our client’s throat on a daily basis is that  after completion of all clearing formalities and issuance of TDO, they proceed to load and take delivery of their cargo only  for them and their colleagues to be unable to enter the terminal and load because of contrived congestion in the terminal or lack of space or inability of our designated truck to gain access into the terminal to load which is absolutely no fault of theirs.

“This unfortunate scenario can last several days or weeks. While our clients  are battling to access and load their cargo /containers the terminal and shipping companies will keep charging demurrage for a delay that is not caused by our clients but by the terminals who fail to make their terminal accessible for easy delivery and the shipping companies who have failed to provide adequate holding bays for their empty containers which has worsened the situation.

“It is also saddening to note that when our clients eventually take delivery and return the empty container(s) the shipping companies will refuse to receive them on account of lack of space and for as long as our client’s battle to drop the empty container(s) the shipping companies and terminals will continue to unconscionably charge them demurrage.  There is no justification for these continuing demurrage charges and our clients demand an immediate end to it.’’

Citing a directive contained in a notice by the Nigerian Shippers Council, NSC/LN-SC/2019/002, which says that all shipping companies and shipping agencies shall refund container deposits to importers within four working days after return of the empty containers, he further stated: “In gross violation of the above Government Regulation which is made pursuant to existing laws of Nigeria, Shipping Companies  operating in Nigeria have continued to hold on to our client’s  container deposits for weeks and sometimes  months after the empty containers have been returned.

“We demand that from henceforth  every shipping company must comply with our laws and refund container deposits within a maximum of four days after return of the empty containers and the refund must be made in full except in proven cases where the container was damaged  in the custody of the freight forwarder/importer provided such damage is traceable to an act of willful negligence on the part of the freight forwarder or transport.’’

On holding bays he stated: “Our clients  observed that after pressures in previous engagements, shipping companies rented spaces which are grossly inadequate to handle the volume of empty containers that   are supposed to be returned to such places. On several occasions our clients are turned back from such holding bays on account of no space.

“Apart from inadequate space, shipping companies or terminals operating such holding bays impose illegal charges on our clients and their colleagues for bringing the empty containers to the holding bays which they call service charge or any such related charges imposed on our clients for returning empty containers to a designated holding bay is illegal, exploitative and to say the least, outright fraud.

He refered the terminal operators to the government directive, NSC/LN-SC/2019/002 of 9th July 2019 which stated: “Operators of empty container holding bays should promptly receive empty containers at no cost. The government has not approved any levy for the return of empty containers. Any charge(s) by shipping company/agent or any other service provider arising from delay in accepting empty container(s) shall be borne by the terminal that causes the delay.”


On the basis of the directive, he demanded that shipping companies provide holding bays with adequate capacity to hold their respective volume of empty containers.

He stated further: “From findings, our clients have noticed a systemic reluctance on the part of shipping companies to take back and evacuate their empty containers from Nigeria which has worsened the problem of storage and evacuation of empty containers thereby turning our dear country to a dumping ground.

‘‘At the same time the shipping companies seize the opportunity to impose illegal charges on Nigerians for a failure of the shipping companies themselves to provide adequate and sufficient spaces to receive the empty containers.

“Our clients, therefore, demand refund of all illegal charges and demurrage collected by shipping companies since the past two years as they are in the process of compiling all the documents and receipts in this regard.’’

The group also noted that it is now illegal for any shipping company to withhold consignments  due to outstanding payment on previous transactions by freight forwarders.

Ochonogo stated: “Any shipping company  who has such claim against a freight forwarder is by law required to forward its complain to the Council for Regulation of Freight Forwarding in Nigeria (CRFFN) and not to withhold release of any consignment or container.

“We notice that shipping companies have continued to indulge in this brazen illegality and we hereby demand immediate end to such unfair and illegal trade practice.’’

Concluding, in a letter to the shipping firms, he stated: “You are by this letter put on notice that our clients shall calculate all losses incurred by them and their colleagues (in the event that you fail to address all the issues raised after the period granted) and pass them to you for settlement.

“Any service provider who causes delay or service failure shall henceforth bear the cost and associates penalty charges arising from such delay or service failure.”

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